business essay

Chapter 1 Introduction and Objectives

Published: 23, March 2015

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Fast food is so widely and easily available. Western consuming habits had spread world wide. American as the originator of fast food are the biggest group of consumers and on the move making alliance on quick and cheap meal. They have created a huge business for fast food companies. Across to Asian region, where mostly local food considered to be healthy but there are so many people willing to eat fast food which is considered to be more expensive and less in nutrition. It is possible that taste and trend overwhelm the bad things. Also, Marketing is the catalyst to the growth of fast food.

Background

The process of globalization got under way in earnest in Asia about ten years ago when fast food firstly approach to Asian market as a trendy food. As time changes, it is now blamed to be junk food to many consumers. Fast Food Company spends a fortune on advertising and they always try to create new attractive choice. However, the market seems to be saturated and it is time to find out real consumer trends.
In the last few decades, Asian lifestyles have changed drastically. Basically, the Asia countries area are primary agricultural, most people lived in rural areas usually living off land and spending their day farming. Now, working life has forced people behind a desk and lack of free time. The fact that it is quicker and cheaper to get fast food on the run than prepare own meals makes fast food industry grows.

Recently, the western style fast food restaurant has gained popularity among Thai customers. This can be judged from the abundance of outlets like McDonald's, KFC and Pizza Hut, which have mushroomed all around Thailand due to the constantly changing lifestyle of people because of economic changes, social development and advanced technology, etc. these changes can be seen more obviously in big cities. Thai consumer behaviour has also changed as time has become more valuable, cooking and eating at home is not worth doing especially for working people.

In 1977, Pizza Hut became the first American fast food restaurant to open a branch in Bangkok, Thailand. This was followed by a number of western style fast food restaurants such as McDonald's. The popularity of fast food restaurant has increased dramatically because of the blooming of middle income class and also because of the acculturation of Thai people. Additionally, working women have little time to cook, according to a 21-market study, including Thai, conducted by ACNielsen. ACNielsen Life Choices research 2006 was a qualitative in-depth study of a total of 84 groups of women of different social status young working women, women of broad middle class and mothers with children age under ten in 21 markets. The common characteristic of all of them was that they bought food and drinks out-of home (snacks, take-away and dine-out) five times a week or more.

Bangkok's rapid development and traffic jams have also helped to popularize fast food. Every shopping mall seems to have fast food for customers, as well as the change in lifestyle of people likes the two-earner households are less likely to prepare evening meals at home. Having mobiles allows people more convenience to get out for quick meal by making last minute arrangement with friends. Besides, the more wage earners in the family, the fewer members prepare the food.

According to the booming business western fast food style in Thailand such as McDonald, KFC, Pizza hut, etc. which are all brands that are well known as foreign fast food for consumers' perception (McLean, 2007.).

Fast-food restaurants have their own benefits, which their customers perceive. These perceived benefits are the primary reasons why they are patronized. Consumers rate these benefits or the values that they see in the product. Detailed information on the preferences of these consumers is revealed through representative samples of how they rate the importance of such benefits. Certainly, most people would like as many benefits as possible. However, the relative importance they attach to individual benefits can differ significantly and these can be used as effective barometers in segmenting the markets. Astute marketers have long realized that in addition to brand image, their company image can strongly influence consumer's behaviour toward their enterprise and its products (Kasulis and Lusch, 1981). A company's image is the perception consumers have of its character as a result of their experience with it and their knowledge of and beliefs about it. Similarly, consumer patronage of a particular retail store can also be significantly influenced by their perception of its image or personality. Store image may be defined as the way in which the store is defined in the shopper's mind, partly by its functional qualities and partly by an aura of psychological attributes (Pessemier, 1980).

This definition implies that the fast-food restaurant image could be derived from the so-called functional attributes of price, convenience, and selection of menu. Variables such as architecture, interior design and advertising could influence a restaurant's image as well. Therefore, consumers can develop images of fast-food restaurants regardless of whether management consciously attempts to project a specific image or not. For this reason, it is important for management to understand their image, as consumers perceive it. If the consumers' criteria for selecting a particular restaurant from among other competitors can also be identified, then management can determine how the restaurant is evaluated or measured.

According to Kotler (2008), positioning is the act of designing the company's offering and image so that it occupies a distinct and valued place in the target customer's mind. The management of a fast-food establishment therefore, needs to describe to his customers how his store differs from current and potential competitors. Using his store attributes, he can project an image or personality that directly influences the consumer patronage of the store. It is then ultimately the consumer's perception of all the competing outfits that will decide or establish the mode of direct or indirect competition among industry participants. This picture is captured in the product-market structure. It is the purpose of this study to establish the current product-market picture of the Thai fast-food industry and determine the forces that are responsible for the structural linkages.

Markets consist of various buyers, and buyers differ in one or more respects. They may differ in their wants, resources, geographical locations, buying attitudes, lifestyles, and buying practices. Any of these variables can be used to segment a market. Market segmentation reveals the potential market opportunities facing the establishment. The establishment now has to evaluate the various segments and decide on which segment or segments to serve. The question of how many segments to serve can also be addressed, either to increase market share or develop niches, as a competitive strategy. The establishment, in evaluating different market segments, must look at factorssuch as segment size and growth, segment structural attractiveness, and company objectives and resources. Within each segment, the establishment needs to develop a product-positioning strategy.

Food diversity in Thailand is an implicit characteristic of Thai's diversified culture consisting of different regions. Traditionally, Thais like to have home-cooked meals - a concept support individually. However, with times due to increasing awareness and influence of western culture, there is a slight shift in food consumption patterns among urban Thai families. It started with eating outside and moved on to accepting a wide variety of delicacies from world-over. Liberalization of the Thai economy in the early 1990s and the subsequent entry of new players set a significant change in lifestyles and the food tastes of Thai people. Fast food is one which gained acceptance of Thai palate after the multinational fast food players adapted the basic Thai food requirements such as local adapted meals and selected options excluding beef and pork totally from their menu.

Multinational fast food outlets initially faced protests and non-acceptance from Thai consumers. This was due to primary perception that these fast food players serve only hi calories meals and do not serve vegetable meals. In addition, fast food is perceived expensive besides being out-of-way meals in Thai culture. Today, fast food industry is getting adapted to Thai food requirements and is growing in Thailand. It is gaining acceptance primarily from Thai youth and younger generations and is becoming part of life. Keeping in view the Thai habits and changing preferences towards food consumption, this study has its focus to understand the factors affecting the perception of Thai consumer, towards consumption of fast food as well as towards making choice of fast food outlets.

The fast food chain investors are now focusing on marketing strategy or planning for restaurants. This research tends to provide the most recent research of consumer perception and customer behaviour for fast food restaurant in Thailand. Therefore, the researcher is deeply interesting to study and emphasize of understanding customer in term of their perception and behaviour in order to develop fast food market segment, target and positioning as well as the marketing mix strategy.

Statement of research question

Marketing researchers have become increasingly concerned with the important of marketing mix factors (Wise and Sirohi, 2005). Mostly existing researches only performed in Asians country such as India and Philippine or china. This research which was conducted focusing on fast food restaurant in Thailand tried to find results base on the topic of consumers' perception. Anyway the literature alone can not answer all the questions, so the research is needed to be done regarding the following research aims and objectives.

Research aim

The topic has been chosen to be done with the popularity of consumers in Thailand and to evaluate the consumers' perception toward fast food. This dissertation aims to accomplish under the area of consumers' perception and the factors that affecting the perceptions of consumers on fast food in Thailand and then suggests on any possible recommendation to strengthen the value of fast food with respect to the consumption pattern of consumers in Thailand.

Research objectives

To review the current situation for fast food industry in Thailand.

To evaluate consumers' perception and consumption pattern on fast food in Thailand.

To critically analyse the factors affecting the perceptions of consumers on fast food in Thailand.

To propose some recommendations to strengthen the value of fast food with respect to the consumption pattern of consumers in Thailand.

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